Audio 3:48
Obama urges swift Senate tick for Fed nominee

Peter Ryan
Thu 10 Oct 2013, 8:50 AM AEDT

President Obama is urging the US Senate to endorse his nominee to replace Ben Bernanke as chairman of the Federal Reserve. Janet Yellen's nomination was brought forward in a bid to calm financial markets given fears about a deadlock on the US debt ceiling.

Transcript

TIM PALMER: Well, as the debt ceiling deadline edges closer, president Obama has moved to provide some certainty for the financial markets, this morning officially nominating his replacement for Ben Bernanke who's retiring as chairman of the US Federal Reserve early next year.

If the US Senate endorses the president's pick, Janet Yellen, she'll become the first woman to head the Fed.

I'm joined by our business editor Peter Ryan. Peter, what do we know about Janet Yellen and does she have what it takes and will she follow the same path as Ben Bernanke?

PETER RYAN: Well, Tim, Janet Yellen is Ben Bernanke's current deputy. She's 67, she's from Brooklyn and is highly regarded by other central bankers around the world.

Now this morning's announcement appears to have been brought forward as president Obama tries to calm financial markets with a morsel of certainty given the dramatic language about the impact of a US default.

Ms Yellen like Ben Bernanke is seen as a steady hand five years after the Wall Street collapse. She is likely to keep interest rates low and will be cautious about winding back the Fed's economic stimulus program - currently $85 billion a month.

This morning as president Obama confirmed the nomination, he said Janet Yellen ticked all the boxes he wants in a Federal Reserve chief.

BARACK OBAMA: She is a proven leader and she's tough, not just because she's from Brooklyn. Janet is exceptionally well qualified for this role. She has served in leadership positions at the Fed for more than a decade. Janet is renowned for her good judgement. She sounded the alarm early about the housing bubble, about excesses in the financial sector and about the risks of a major recession.

She doesn't have a crystal ball but what she does have is a keen understanding about how markets and the economy work, not just in theory but also in the real world, and she calls it like she sees it.

TIM PALMER: That's the US president Barack Obama of course speaking about Janet Yellen.

It is a huge moment for Janet Yellen, Peter, of course, being the first woman nominated.

PETER RYAN: Yes and Barack Obama will be seeing this, of course, as part of his legacy for change. And he said that Ms Yellen as the first women to lead the Federal Reserve would make her a role model for many.

Now Ms Yellen joined the president in praising Ben Bernanke, who was present at the event, saying he was the epitome of calm, serenity and courage during the worst financial crisis since the Great Depression.

It is possible she'll meet Republican resistance during Senate confirmation but this morning Ms Yellen sent a very clear message that she's more than up to the job.

JANET YELLEN: The past six years have been tumultuous for the economy and challenging for many Americans. Well, I think we all agree Mr President that more needs to be done to strengthen the recovery, particularly for those hardest hit by the great recession. We have made progress, the economy is stronger and the financial system sounder.

TIM PALMER: That's Janet Yellen, who is president Obama's nominee to be chairman of the Fed Reserve.

Peter, economics is known of course as the dismal science. Is Janet Yellen one of those dry practitioners of that science?

PETER RYAN: Well, like Ben Bernanke, she'll be trying her best to demystify the craft and cut the jargon.

By the way, both her husband and son are well known economists. But president Obama confirmed what we already expected I suppose, that Ms Yellen certainly lives her work.

BARACK OBAMA: You can imagine the conversation around the dinner table might be a little different than ours. (Laughter) In fact I've been told their idea of a great family vacation is the beach with a suitcase full of economics books.

TIM PALMER: President Obama on Janet Yellen and before that our business editor Peter Ryan.